How to invest in Japan using ETFs

How do I invest in Japanese stocks?

The easiest way to invest in the whole Japanese stock market is to invest in a broad market index. This can be done at low cost by using ETFs.

On the Japanese stock market you find 7 indices, which are tracked by ETFs. Besides these indices 1 alternative index on small and mid caps or equity strategies can be considered.

A speciality for ETFs on Japan is the large number of currency hedged ETFs that are available. In total there are 9 currency hedged indices tracked by 22 ETFs.

Alternatively, you can consider indices on the Pacific region. In the Pacific indices, Japan is strongly weighted with around 65%.

0.09% p.a. - 0.59% p.a.
annual total expense ratio (TER) of Japan ETFs
on the Japanese stock market, which are tracked by ETFs
on the Japanese stock market
The best indices for Japan ETFs

Performance of Japanese stocks (MSCI Japan)

1 month: 8.32%
1 year: 9.18%
3 years: 9.58%
5 years: 42.02%

Indices in comparison

The best indices for ETFs on Japan

For an investment in the Japanese stock market, 7 indices tracked by 21 ETFs are available. On the FTSE Japan index there are 2 ETFs. On the JPX-Nikkei 400 index there are 4 ETFs. On the MSCI Japan index there are 9 ETFs. On the MSCI Japan IMI index there is 1 ETF. On the Nikkei 225® index there are 2 ETFs. On the Solactive Core Japan Large & Mid Cap index there is 1 ETF. On the TOPIX® index there are 2 ETFs. The total expense ratio (TER) of ETFs on these indices is between 0.09% p.a. and 0.59% p.a..

Index Investment focus Number of ETFs Number of constituents Short description

FTSE Japan

Japan 2 ETFs 508
(30/04/20)
The FTSE Japan index tracks Japanese large and mid cap stocks.
Index factsheet

JPX-Nikkei 400

Japan 4 ETFs 400
The JPX-Nikkei 400 index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit.
Index factsheet

MSCI Japan

Japan 9 ETFs 321
(29/05/20)
The MSCI Japan index tracks leading Japanese stocks.
Index factsheet

MSCI Japan IMI

Japan 1 ETF 1,306
(30/04/20)
The MSCI Japan IMI index tracks stocks from Japan. It covers securities across large, mid and small cap size segments.
Index factsheet

Nikkei 225®

Japan 2 ETFs 225
The Nikkei 225® index tracks the 225 most actively traded stocks on the first section of the Tokyo Stock Exchange.
Index factsheet

Solactive Core Japan Large & Mid Cap

Japan 1 ETF 340
(30/04/20)
The Solactive Core Japan Large & Mid Cap index tracks the Japanese market and measures the performance of large and mid-cap publicly traded which satisfy minimum criteria relating to liquidity and size and excludes companies: (a) engaged in pure coal mining; (b) involved in the production of controversial weapons, such as cluster weapons, anti-personnel mines or biological and chemical weapons; or (c) that, for a continuous period of three years, have been classified as being in breach of at least one of the UN Global Compact principles.
Index factsheet

TOPIX®

Japan 2 ETFs 2,166
(30/04/20)
The TOPIX® index tracks a broad selection of Japanese stocks listed on the TSE First Section segment of Tokyo Stock Exchange.
Index factsheet
ETF
ISIN
  Fund size
in m GBP
TER
in %
Use of profits Fund domicile Replication method
iShares Core MSCI Japan IMI UCITS ETFIE00B4L5YX21 2,708 0.15% p.a. Accumulating Ireland Optimized sampling
Vanguard FTSE Japan UCITS ETF DistributingIE00B95PGT31 1,366 0.15% p.a. Distributing Ireland Full replication
Xtrackers MSCI Japan UCITS ETF 1CLU0274209740 1,270 0.30% p.a. Accumulating Luxembourg Full replication
Xtrackers Nikkei 225 UCITS ETF 1DLU0839027447 1,086 0.09% p.a. Distributing Luxembourg Full replication
iShares MSCI Japan UCITS ETF (Dist)IE00B02KXH56 843 0.59% p.a. Distributing Ireland Optimized sampling
Lyxor Core MSCI Japan (DR) UCITS ETFLU1781541252 539 0.12% p.a. Accumulating Luxembourg Full replication
UBS ETF (LU) MSCI Japan UCITS ETF (JPY) A-disLU0136240974 525 0.19% p.a. Distributing Luxembourg Full replication
Lyxor Japan (Topix) UCITS ETF (DR) D-EURFR0010245514 494 0.45% p.a. Distributing France Full replication
iShares MSCI Japan UCITS ETF USD (Acc)IE00B53QDK08 306 0.48% p.a. Accumulating Ireland Full replication
Lyxor JPX-Nikkei 400 (DR) UCITS ETF C-EURLU1646359452 236 0.25% p.a. Accumulating Luxembourg Full replication
Xtrackers JPX-Nikkei 400 UCITS ETF 1DIE00BPVLQD13 196 0.20% p.a. Distributing Ireland Full replication
iShares Nikkei 225 UCITS ETF (Acc)IE00B52MJD48 177 0.48% p.a. Accumulating Ireland Full replication
HSBC MSCI Japan UCITS ETF USDIE00B5VX7566 158 0.19% p.a. Distributing Ireland Full replication
L&G Japan Equity UCITS ETFIE00BFXR5T61 90 0.10% p.a. Accumulating Ireland Optimized sampling
Invesco JPX-Nikkei 400 UCITS ETFIE00BPRCH686 78 0.19% p.a. Accumulating Ireland Unfunded swap
Amundi ETF Japan Topix UCITS ETF JPYLU1681037781 64 0.20% p.a. Accumulating Luxembourg Unfunded swap
Amundi ETF JPX Nikkei 400 UCITS ETF JPYLU1681039050 60 0.18% p.a. Accumulating Luxembourg Unfunded swap
SPDR MSCI Japan UCITS ETFIE00BZ0G8B96 21 0.12% p.a. Accumulating Ireland Optimized sampling
Vanguard FTSE Japan UCITS ETF AccumulatingIE00BFMXYX26 19 0.15% p.a. Accumulating Ireland Full replication
Invesco MSCI Japan UCITS ETFIE00B60SX287 3 0.19% p.a. Accumulating Ireland Unfunded swap
Amundi ETF MSCI Japan UCITS ETF DR JPYLU1602144815 2 0.45% p.a. Accumulating Luxembourg Full replication
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
TOPIX® 8.12% 8.97% -1.06% 7.87% 11.69%
MSCI Japan IMI 7.56% 8.50% -1.52% 8.39% 13.56%
MSCI Japan 7.21% 7.81% -1.27% 8.54% 13.71%
FTSE Japan 7.35% 8.69% -0.96% 8.71% 13.59%
Solactive Core Japan Large & Mid Cap 7.25% 8.08% -1.06% 9.06% -
JPX-Nikkei 400 8.63% 9.19% -0.22% 9.35% 13.61%
Nikkei 225® 9.10% 10.19% 1.22% 11.61% 25.95%
Index   2020
in %
2019
in %
2018
in %
2017
in %
2016
in %
Solactive Core Japan Large & Mid Cap -0.71% 16.30% - - -
TOPIX® -0.49% 14.30% -9.07% 14.28% 23.69%
MSCI Japan IMI -0.36% 15.96% -8.77% 13.97% 24.23%
MSCI Japan -0.15% 15.35% -8.49% 13.17% 22.75%
FTSE Japan 0.07% 15.17% -8.59% 13.61% 23.24%
JPX-Nikkei 400 0.22% 14.24% -8.35% 13.03% 23.34%
Nikkei 225® 1.70% 17.65% -3.22% 14.96% 26.39%

Source: justETF.com; As of 31/05/20; Calculations in GBP based on the largest ETF of the respective index.

 

The cheapest Japan ETFs
by total expense ratio (TER)

Show all

Japan ETFs with hedged currency risk

Currency hedged investing in Japanese stocks is popular. In total, you can consider 9 currency hedged Japan indices tracked by 22 ETFs. The total expense ratio (TER) of ETFs on Japan indices with currency hedge is between 0.17% p.a. and 0.64% p.a..

 
Index Investment focus Number of ETFs Number of constituents Short description
JPX-Nikkei 400 (EUR Hedged) Japan 1 ETF 400
The JPX-Nikkei 400 Daily (EUR Hedged) index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit. Daily Currency hedged to Euro (EUR).
Index factsheet
JPX-Nikkei 400 (GBP Hedged) Japan 3 ETFs 400
The JPX-Nikkei 400 (GBP Hedged) index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit. Currency hedged to British Pound (GBP).
Index factsheet
JPX-Nikkei 400 (USD Hedged) Japan 5 ETFs 400
The JPX-Nikkei 400 Daily (USD Hedged) index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit. Currency hedged to US dollar.
Index factsheet
MSCI Japan (EUR Hedged) Japan 2 ETFs 321
(30/04/20)
The MSCI Japan (EUR Hedged) index tracks leading stocks on the Japanese market. Currency hedged to Euro (EUR).
Index factsheet
MSCI Japan (GBP Hedged) Japan 5 ETFs 323
(30/09/19)
The MSCI Japan (GBP Hedged) index tracks around 320 leading stocks on the Japanese market. Currency hedged to British Pounds (GBP).
Index factsheet
MSCI Japan (USD Hedged) Japan 2 ETFs 324
(29/11/19)
The MSCI Japan (USD Hedged) index tracks leading stocks on the Japanese market. Currency hedged to US Dollar (USD).
Index factsheet
Nikkei 225® (EUR Hedged) Japan 1 ETF 225
The Nikkei 225® (EUR Hedged) index tracks the 225 most actively traded stocks on the first section of the Tokyo Stock Exchange. Currency hedged to Euro (EUR).
Index factsheet
Nikkei 225® (USD Hedged) Japan 1 ETF 225
The Nikkei 225® (USD Hedged) index tracks the 225 most actively traded stocks on the first section of the Tokyo Stock Exchange. Currency hedged to US-Dollar (USD).
Index factsheet
WisdomTree Japan Equity (USD Hedged) Japan 2 ETFs 500
(30/04/20)
The WisdomTree Japan (USD Hedged) Equity index tracks Japanese stocks. The Index is a fundamentally weighted index. Currency hedged to US-Dollar (USD).
Index factsheet
ETF
ISIN
  Fund size
in m GBP
TER
in %
Use of profits Fund domicile Replication method
Lyxor Core MSCI Japan (DR) UCITS ETF Acc GBP HedgedLU1781541682 9,339 0.20% p.a. Accumulating Luxembourg Full replication
iShares MSCI Japan EUR Hedged UCITS ETF (Acc)IE00B42Z5J44 751 0.64% p.a. Accumulating Ireland Optimized sampling
iShares MSCI Japan USD Hedged UCITS ETF (Acc)IE00BCLWRG39 182 0.64% p.a. Accumulating Ireland Optimized sampling
iShares MSCI Japan GBP Hedged UCITS ETF (Acc)IE00B7XYN974 95 0.64% p.a. Accumulating Ireland Optimized sampling
Xtrackers MSCI Japan UCITS ETF 2D USD hedgedLU0927735406 64 0.40% p.a. Distributing Luxembourg Full replication
Nomura JPX-Nikkei 400 NTR D EUR Hedged UCITS ETFIE00BVVSZ262 45 0.30% p.a. Accumulating Ireland Full replication
Amundi ETF JPX Nikkei 400 UCITS ETF Daily Hedged USDLU1681039217 39 0.18% p.a. Accumulating Luxembourg Unfunded swap
Nomura Nikkei 225 EUR Hedged UCITS ETFIE00BSKS1J57 28 0.60% p.a. Accumulating Ireland Full replication
Nomura Nikkei 225 USD Hedged UCITS ETFIE00BSMSXM06 23 0.60% p.a. Accumulating Ireland Full replication
WisdomTree Japan Equity UCITS ETF USD HedgedIE00BVXC4854 18 0.48% p.a. Distributing Ireland Optimized sampling
Invesco JPX-Nikkei 400 USD Hedged UCITS ETFIE00BVGC6751 17 0.19% p.a. Accumulating Ireland Unfunded swap
UBS ETF (LU) MSCI Japan UCITS ETF (hedged to GBP) A-disLU1169822340 15 0.29% p.a. Distributing Luxembourg Full replication
Lyxor JPX-Nikkei 400 (DR) GBP Daily Hedged UCITS ETFLU1646359619 13 0.25% p.a. Accumulating Luxembourg Full replication
WisdomTree Japan Equity UCITS ETFIE00BYQCZD50 13 0.48% p.a. Accumulating Ireland Optimized sampling
Xtrackers MSCI Japan UCITS ETF 6C GBP hedgedLU0659580236 10 0.40% p.a. Accumulating Luxembourg Full replication
Nomura JPX-Nikkei 400 NTR D USD Hedged UCITS ETFIE00BVVSZ379 10 0.30% p.a. Accumulating Ireland Full replication
Lyxor JPX-Nikkei 400 (DR) USD Daily Hedged UCITS ETFLU1646359882 10 0.25% p.a. Accumulating Luxembourg Full replication
UBS ETF (LU) MSCI Japan UCITS ETF (hedged to GBP) A-accLU1169822423 9 0.29% p.a. Accumulating Luxembourg Full replication
Xtrackers JPX-Nikkei 400 UCITS ETF 4C USD hedgedIE00BTGD1B38 8 0.30% p.a. Accumulating Ireland Full replication
Xtrackers JPX-Nikkei 400 UCITS ETF 2D GBP hedgedIE00BPVLQF37 6 0.30% p.a. Distributing Ireland Full replication
SPDR MSCI Japan EUR Hedged UCITS ETFIE00BZ0G8C04 3 0.17% p.a. Accumulating Ireland Optimized sampling
Amundi ETF JPX Nikkei 400 UCITS ETF Daily Hedged GBPLU1681039308 1 0.18% p.a. Accumulating Luxembourg Unfunded swap
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
MSCI Japan (GBP Hedged) 6.61% 2.81% -7.58% 5.08% -
WisdomTree Japan Equity (USD Hedged) 7.71% 4.41% -6.76% 5.39% 5.45%
MSCI Japan (EUR Hedged) 10.36% 8.91% -2.10% 6.29% 5.86%
JPX-Nikkei 400 (GBP Hedged) 7.43% 4.99% -5.86% 6.95% 6.34%
JPX-Nikkei 400 (EUR Hedged) 11.12% 9.98% -1.62% 7.06% 6.28%
Nikkei 225® (EUR Hedged) 12.02% 9.69% -0.56% 8.13% 15.30%
MSCI Japan (USD Hedged) 8.00% 7.96% -2.19% 9.41% 15.74%
JPX-Nikkei 400 (USD Hedged) 8.53% 8.24% -2.26% 9.72% 15.68%
Nikkei 225® (USD Hedged) 9.60% 8.72% -0.61% 11.39% 26.00%
Index   2020
in %
2019
in %
2018
in %
2017
in %
2016
in %
MSCI Japan (GBP Hedged) -7.67% 17.05% - - -
JPX-Nikkei 400 (GBP Hedged) -6.01% 16.57% -16.31% 19.65% -2.55%
WisdomTree Japan Equity (USD Hedged) -5.78% 14.82% -14.07% 11.24% 21.42%
MSCI Japan (EUR Hedged) -2.58% 11.45% -16.05% 22.84% 12.98%
JPX-Nikkei 400 (EUR Hedged) -1.81% 9.67% -15.86% 23.40% 13.31%
JPX-Nikkei 400 (USD Hedged) -1.51% 17.40% -9.90% 10.31% 17.86%
Nikkei 225® (EUR Hedged) -1.07% 11.05% -10.96% 23.97% 14.96%
MSCI Japan (USD Hedged) -0.63% 15.95% -9.35% 9.96% 18.11%
Nikkei 225® (USD Hedged) 0.51% 16.84% -3.79% 10.99% 20.72%

Source: justETF.com; As of 31/05/20; Calculations in GBP based on the largest ETF of the respective index.

 
Alternative investment opportunities

Japanese indices on small and mid caps or equity strategies

Alternatively, you may invest in indices on small and mid caps or equity strategies. In total, you can invest in 1 alternative index on Japan tracked by 1 ETF. The total expense ratio (TER) of ETFs on these alternative indices is around 0.58% p.a..

 
Index Investment focus Number of ETFs Number of constituents Short description
MSCI Japan Small Cap Japan
Small Cap
1 ETF 982
(29/05/20)
The MSCI Japan Small Cap index tracks Japanese small cap stocks.
Index factsheet
ETF
ISIN
  Fund size
in m GBP
TER
in %
Use of profits Fund domicile Replication method
iShares MSCI Japan Small Cap UCITS ETF (Dist)IE00B2QWDY88 234 0.58% p.a. Distributing Ireland Optimized sampling
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
MSCI Japan Small Cap 8.94% 11.21% -3.56% 6.31% 9.55%
Index   2020
in %
2019
in %
2018
in %
2017
in %
2016
in %
MSCI Japan Small Cap -2.05% 15.34% -11.57% 19.18% 29.07%

Source: justETF.com; As of 31/05/20; Calculations in GBP based on the largest ETF of the respective index.

 

Pacific indices with a large share of Japan

Besides, Japan ETFs you can consider ETFs on the Pacific stock market. On the Pacific region 9 indices tracked by 22 ETFs are available. The MSCI Pacific index contains a significant weight of Japan with around 65%. The total expense ratio (TER) of ETFs on the Pacific region is at -.

 
 
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